§ 1908. Powers of private banks
Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 7 P.S. Banks and Banking
7 P.S. § 1908
§ 1908. Powers of private banks
(a) Extent of powers--Except as otherwise specifically provided in this act, a private bank shall have all of the powers of a natural person and, except for general corporate powers under this act, it shall also have all of the powers of a bank, but it shall be subject to the same restrictions and limitations as are imposed upon a bank by this act regarding direct leasing of personal property, indebtedness acquired from a single customer, real estate loans, loans secured by shares of corporate stock, pledges for deposits except as provided hereafter, bonds and suretyship, borrowings, preferential rates of interest and loans to and agreements for the payment of money of officers and employes. After December 31, 1980, each consumer deposit in a private bank at any office thereof in Pennsylvania shall be either:
(v) insured or secured by any combination of the above in a total amount equal to that set forth in subsection (d)(i). A consumer deposit shall be a deposit of one or more individuals other than one in which any beneficial interest is held by a corporation, partnership, association, joint venture or other organization operated for profit.
(b) Net worth as basis for limitations--Where any restriction or limitation is imposed upon a bank based upon a percentage of its capital and surplus, such percentage, in the case of a private bank, shall be computed upon its net worth. No such percentage restriction or limitation shall apply to the issuing, negotiating, buying, or underwriting of, primarily for the purpose of resale or distribution, or to the selling or distributing of, or to the dealing at wholesale or retail or through syndicate participation in, bonds, debentures, notes or other securities by any private bank which is registered as a dealer in securities under the laws of this Commonwealth and which has a net worth of not less than one hundred thousand dollars.
(c) Offices in other states and countries--A private bank, which, upon the effective date of this act, lawfully maintains one or more offices or places of business in any other state or foreign country may do and perform all such acts, and make all such loans, discounts, and investments at such offices or places of business as are permitted or required under the laws of such other state or foreign country, subject to such restrictions or limitations as may be imposed by the laws of such other state or foreign country.
(I) any other securities that are marketable and approved by regulation of the department for the purpose of this section. Such assets shall be deposited, subject to an agreement approved by the department, with an incorporated depository located in the Commonwealth and authorized by section 105(a)1 to engage in the business of receiving money for deposit. Whenever the department shall determine that the market value of such assets is less than the amount of the deposits which it secures, the private bank shall pledge additional assets having a market value not less than the amount of such deficiency. With subsequent notice to the department within three business days, the private bank may from time to time make substitutions of assets pledged so long as the value of the total assets pledged shall be equal to the aggregate amount required under clause (i), and subject to the right of the department to disapprove the inclusion of specific assets so substituted.
(iii) The assets pledged shall constitute a fund for the benefit of the owners of consumer deposits with the private bank in the same manner and to the same extent as deposit insurance benefits would be available if such consumer deposits were insured by the Federal Deposit Insurance Corporation or by any other Federal agency authorized by law to insure deposits, and other creditors of the private bank shall not have any rights whatsoever against such assets pledged.
(iv) After December 31, 1980, all passbooks, certificates of deposit and similar instruments issued as evidence of ownership for deposit accounts, which are not insured or covered by a pledge of assets, shall bear the legend “This Account is Not Insured” in such size and print as to be clearly legible or as may be prescribed by regulation of the department. A copy of this section and all amendments thereto shall be maintained in every private banking office and shall be available for review upon demand by any member of the public, and reference to this section shall appear in any solicitation of consumer deposits.
Credits
1965, Nov. 30, P.L. 847, No. 356, § 1908. Amended 1978, Oct. 5, P.L. 1085, No. 254, § 1, imd. effective.
Footnotes
7 P.S. § 105.
7 P.S. § 1908, PA ST 7 P.S. § 1908
Current through the end of the 2023 Regular Session. Some statute sections may be more current, see credits for details.
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